law from the inside out

Legal Tech at the Crossroads

February 21, 2011

With all the uncertainty roiling the corporate legal market, many are turning to technology as a big part of the answer. It will be for some things and it may be for many others. (Part II is here; Part III is here).

But there is a syllogism underpinning much of the debate. Here it is:

1. Corporate legal needs change.

2. Technology is change.

3. Corporate legal needs technology.

Under this simple mantra, legal tech becomes the default solution to a lot of problems. Those who question it can be branded Luddites. And in the legal market, Lord knows, they may be.

Yet as a military often prepares for the next war by endlessly replaying the last one, some in the legal tech community are pushing solutions borne years ago, re-tweaked or re-branded to hopefully, magically, fit in the new era.

I don’t think it will work this time around.

So this week I will lay out why I think Legal Tech (the industry, not the conference) is at a crossroads. It didn’t fit in one post here, so I will break it up into three or four.

A big hint as to where this will start: much of legal tech is still being sold as if we remain in a cost-plus world of the venerable Billable Hour. Where solutions can be loaded with complexity, marked up heavily and then pushed into law firms via the IT departments. The champion partner at the firm gets them past these digital gatekeepers by saying “the client wants it and will pay for it.”

Oh, will they? I think the train departed Pass-Through City some time ago.

These same solutions typically had long lead times to spec out, develop, test, install, test, roll-out, train, debug, and then service. Focus carefully on that last word. No one in legal tech wants to just sell software anymore. They want the service that goes with it. High-margin, continuity income for the life of the contract.

The essential problem may be that the corporate legal industry is changing faster than old-time technology can.

(The first two titles to this series were (a) Legal Technology and the Illusion of Progress, or (b) The Coming Crash in Legal Tech. I have learned to write in the evening and edit in the morning. It only took six years to figure that out…).